What is fixed income?
A fixed income security is an investment that pays a fixed profit on a regular schedule. It is an investment approach that focuses on the preservation of capital and income. Fixed income can offer a steady stream of income with balanced risk.
For an investor who seeks exposure to fixed income, we offer two products at Boubyan Capital that has distinct and different characteristics. The investor has the option to place his investment in our Islamic Global Sukuk Fund or directly request to buy or sell any sukuk that he desires through our sukuk brokerage service.
Islamic Global Sukuk Fund
Fund Objective
The Fund seeks to generate positive returns on the long term with a balanced risk level. The Fund aims to distribute profits, if any, on a quarterly basis upon the discretion of the Fund Manager.
The Fund's strategy is to Invest in local, GCC and global Sukuk denominated in US Dollar or any other currency as deemed fit by the Fund Manager
Fund Features
- Balanced risk level with returns higher than fixed-deposits.
- Monthly liquidity.
- Quarterly distributions (if applicable).
To know more and apply to the fund click here
Sukuk Brokerage
Objective
The Sukuk Brokerage service now enables clients to trade in Sukuk via their brokerage account.
This service is considered the first of its kind in Kuwait and is an innovative addition to Boubyan Brokerage’s diverse portfolio of services.
This service will enable clients to access new Sukuk issuances as well as existing Sukuk options in the market.
Benefits
- Dedicated team ready to execute client orders and respond to any inquiries
- Access to local, regional and international Sukuk markets
To apply for a brokerage account, kindly visit your nearest Boubyan Bank branch.
The table below provides a comparison between investing in the fund as opposed to directly buying a sukuk through the brokerage services.
| The Fund | Brokerage | |
|---|---|---|
| Liquidity | Monthly. The investor can subscribe/redeem monthly at the valuation date. | Depends on the Sukuk. Highly liquid Sukuk can be traded daily (and usually settled in two days (t+2)). Liquidity depends on many factors that affect the supply and demand of the sukuk. |
| Management | Actively managed by fund manager (BCIC) and advisors (NBKC). | Client’s discretion. |
| Minimum investment capital | USD 5,000. | USD 200,000. This is the minimum ticket size which is stated in the issuance. This amount is the market convention on almost all issuances. |
| Diversification | Highly diversified. The fund currently holds more than 25 different sukuk with no more than 8% in a single holding. | Requires large capital to achieve diversification. For example, if an investor would like to hold at least 5 sukuk in his portfolio, he would need at least 1 million dollars as initial capital. |
| Risk level | Low-to-moderate. At least 75% of the fund’s NAV is invested in investment-grade sukuk. | Client’s discretion. |
| Fees | • 0.40% p.a, if 1-month annualized return below 3%. • 0.60% p.a, if 1-month annualized return between 3% to 4%. • 0.75% p.a, if 1-month annualized return above 4%. |
Transaction fees $40 and custody/bookkeeping fees 0.08% p.a on total holdings value. Fees to access new issues are 0.2% with a minimum of $300. |
To know more or to invest in Boubyan Capital's Fixed Income Solutions, kindly contact the Client Relations team on 1803800.